Car insurance can be expensive, so when your rates go up you may be feeling frustrated and confused and left wondering why. There are many reasons why car insurance may go up, but it doesn’t mean you have to simply accept the new rate – there are steps you can take if your car insurance goes up.
We’ll explain more about why your car insurance may have increased and what you can do about it in this article.
Why Did My Car Insurance Go Up?
Car insurance rating can be complicated, and there are several reasons why your car insurance premium may have increased.
1. You filed a claim.
Filing a claim after an auto accident often causes your car insurance premium to go up. Whether your premium increases and by how much depends on many factors about your claim, such as the details of the accident, who was found to be at fault, and the dollar amount of damages claimed.
2. You added drivers, vehicles, or additional coverage.
Making changes to expand your policy, such as by adding another driver, car, or by increasing coverage limits, will likely result in an increase to your rates. Since you are expanding the policy, it makes sense this additional coverage would cost more.
3. You moved or changed addresses.
One factor that affects your car insurance rate is where you live or where your vehicle is principally garaged. If you move houses, it is possible your car insurance rate will increase. Some parts of the country pay more for car insurance than others; for example, if you relocated from one of the cheapest states for car insurance like Maine to one of the most expensive insurance markets like Florida, your auto insurance costs would increase along with the temperature.
4. You had a moving violation hit your record.
If you’ve had a ticket or driving infraction recently, that could cause your car insurance to go up. It can take a renewal cycle before tickets hit your record since usually your car insurance company inquiries your state DMV at renewals only – this means it may seem like your rates didn’t increase following a ticket until you later see a renewal with a higher rate.
5. Rates in your area are increasing.
Sometimes car insurance goes up and it doesn’t have anything to do with you individually – rates may increase because of an increase in accidents in your area. The costs of these accidents are a component in pricing, which helps to explain part of why someone living in a rural area may have a lower cost than if they lived in a busy metropolis.
What Can I Do if My Car Insurance Goes Up?
If your premiums increase, you don’t have to simply accept the increase. There are steps you can take to find a lower car insurance rate.
1. Apply all applicable discounts.
Car insurance companies offer many different types of discounts that can save you money. Make sure your agent has applied all of the discounts you are eligible for, such as bundling your auto and home policies, taking advantage of pre-paying your annual premium or electronic payment discounts, and submitting your child’s report card for a good student rate.
2. Trade data for discounts.
Some auto insurance companies offer a discount to customers who provide them with data. Telematics data, which is information about how often and where you drive, is valuable information for insurance companies who use those metrics in many different ways. You may be eligible for a discount if you are willing to install a telematics device – or use a mobile app – to track and share your driving data with your carrier.
3. Raise your deductible.
If you can afford to pay a higher deductible if you file a claim, that will lower your premium since you are retaining more of the risk by having a higher deductible. If you can’t afford to pay the higher deductible if you had a claim, though, it doesn’t make sense to raise your deductible. Make sure you can afford a high deductible before you make this change.
4. Pay-per-mile policies.
If you don’t drive very often or for very many miles, you might want to consider a pay-per-mile, or usage-based, auto insurance plan. These policies are not available in every state or from every carrier, but if you are eligible for a usage-based insurance policy, it could save you money. These policies work by charging a flat premium and an additional per-mile charge. If you drive infrequently or only a few miles locally around town, this could be a big cost-saver for you.
5. Shop around.
One of the best ways to ensure you are getting the best auto insurance rate is by shopping around and comparing rates. This is a good idea even if your rate did not go up, since you can often find a better rate at renewal than what your current carrier is offering you. Comparing rates can be easy by using our online auto insurance comparison tool to compare rates and save.
How do I Learn More?
You can contact us at EINSURANCE for more help with understanding why did your car insurance go up, what you can do about it, and how we can help you with all your auto insurance needs.